Subsequent to the finding in the High Court of South Africa, Gauteng Local Division, Johannesburg (the “Court”), by Grant AJ in First Rand Bank Ltd v Excel B Shabangu & 4 Others (“First Rand Bank Ltd”) that the amendment of Rule 32 of the Uniform Rules of Court (“Rule 32”) applies retrospectively, Siwendu J, in the same Court, came to a different finding in respect of the amended Rule 32’s procedural and practical effects.
|On the basis of his finding, Grant AJ removed summary judgment applications before him on account that all summary judgment applications with effect from 1 July 2019 fell to be decided under the amended Rule 32.
Siwendu J submitted that given the importance of the Rule 32 amendment, it necessitated his separate judgment. Further, he requested that advocates Van Aswegan, Pretorius and Adam make submissions on, inter alia:
1.the retrospective effect of the amended Rule 32; and
2.the ambit of the discretion of the court.
At the outset, Siwendu J found that although the judgment in First Rand Bank Ltd acknowledged the potential for wasted costs, and that a plaintiff may have to wait, it concluded that such factors did not amount to a substantive impairment of rights nor did they give rise to real prejudice and, consequently, it rendered all procedural steps previously taken under the old Rule 32 ineffective
|Advocates Van Aswegen and Adam, relying on the longstanding presumption against retrospectivity, argued that the amended Rule 32 is not retrospective in effect. Furthermore, Van Aswegen pointed to a long line of cases which provided that where a retrospective application impairs existing rights, it is presumed not to affect matters which are the subject of pending legal proceedings. She argued that on construction, inference and necessary application, the rule does not provide for a retrospective application.
Additionally, advocate Adam took issue with the Grant AJ’s incorrect interpretation of sections 11 and 12 of the Interpretation Act No. 33 of 1957 (the “Act”) in First Rand Bank Ltd, arguing that section 11 of the Act refers to “repeal and substitution” and section 12 of the Act deals with the “effect of the repeal of law” and, when read in context, it cannot be said that section 11 of the Act deals with the amendment of a law only and section 12 of the Act deals with the deletion of law only. It is clear from the statute that section 12 of the Act deals with the effects of the repeal and substitution in section 11 of the Act. The Court agreed with advocate Adam that the interpretation was erroneous when reading sections 11 and 12 of the Act in their proper context.
In his finding, Siwendu J held that the question of retrospective operation of a rule is one inquiry, and the problem of interference with existing rights is another. Even when a rule is expressly stated to be retrospective, the retrospective effect will not apply to completed transactions and matters subject of pending litigation. In this regard, the Court found that pending litigation means all summary judgment applications which were instituted or initiated before 1 July 2019.
Contrary to Grant AJ’s finding in First Rand Bank Ltd, Siwendu J, relying on various case law, contended that the distinction between “procedural” and “substantive” can be elusive and is often contrived. The impairment in a litigant’s substantive right is not hard to find:
1.firstly, there is a line of cases which recognise that even though a statute may appear procedural, if it adversely affects vested rights, which are not procedural, it will be construed prospectively; and
2.secondly, the right to an expeditious determination of a dispute, which is foundational in Rule 32, is substantive. The prejudicial delay in enforcement of a right where time is of the essence, as well as the expeditious exercise of the right to be heard has serious permutations for litigants.
Further, the Court held that Grant AJ overlooked the practical consideration of escalated costs of litigation and the effects of a cost order on an unsuccessful litigant. The amended Rule 32 makes no provision for the costly process of amendment of existing pleadings or the filing of supplementary papers and re-enrolling the applications for a hearing. The Court found that it seems unfair to burden an unsuccessful litigant with these costs. The source of prejudice is not attributable to a party and it is not one that can be cured by a cost order.
Finally, a matter not considered by Grant AJ in First Rand Bank Ltd was raised by advocate Pretorius who argued that the court has inherent power to regulate its proceedings.
Accordingly, Siwendu J disagreed with the finding by Grant AJ in First Rand Bank Ltd and found that:
1. the amended Rule 32 does not apply retrospectively, and there is no inference to be drawn to this effect;
2. the amended Rule 32 has prospective application effective to applications initiated after 1 July 2019;
3. the cases are correctly enrolled and are determinable in terms of the old Rule 32; and separate reasons and orders would be made in respect of each case as it is not necessary to address those in this judgment
The amendments to Rule 32 have prospective application effective to summary judgment applications initiated after 1 July 2019.
Written by Sean Buskin Checked by Kerry Theunissen